The Democratic Republic of Congo and the Republic of Congo are losing at least $12m annually in tax avoidance by logging companies, Greenpeace says.
The environmental group says it has evidence showing how firms like German-owned Danzer group have set up "elaborate profit-laundering schemes". In its report, Conning the Congo, Greenpeace alleges the amount of tax lost each year is 50 times the DR Congo's Ministry of Environment's annual operating budget.Greenpeace says it has documents showing that Danzer's Swiss subsidiary company (Interholco AG) buys timber from its African sister companies (Siforco and IFO) at below the market price and then makes up the shortfall by depositing money in offshore bank accounts. In so doing, the group evades paying big corporate tax and export duties.
Environment Minister Jose Endundo told the BBC's Focus on Africa programme."What I can say about forestry, is that the commission in charge of setting the minimum export prices for timber has not met since 2000. So the logging companies took advantage of the situation to export timber at a price under its real value. It means that the Congolese government has suffered losses in terms of foreign currency earnings and taxes."
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